Hershey(US:HSY)2025-10-30 10:49Financial Performance - Consolidated net sales for Q3 2025 were $3,181.4 million, an increase of 6.5% compared to Q3 2024[5] - Reported net income was $276.3 million, or $1.36 per diluted share, a decrease of 38.2% year-over-year[5] - Adjusted earnings per share-diluted were $1.30, a decrease of 44.4% compared to the previous year[5] - Operating profit for Q3 2025 was $434,583,000, a decrease of 29.2% from $613,164,000 in Q3 2024[44] - Total net sales for the company increased by 6.5% to $3,181,418, while total segment income decreased by 22.4% to $615,615[47] - Operating profit fell by 29.1% to $434,583, with income before income taxes down 28.3% to $371,910[47] Segment Performance - North America Confectionery segment net sales increased by 5.6% to $2,615.6 million, with a segment income decrease of 21.2%[21] - North America Salty Snacks segment net sales rose by 10.0% to $321.0 million, with a segment income increase of 6.9%[24] - International segment net sales increased by 12.1% to $244.8 million, but reported a loss of $13.6 million[26] - North America Confectionery net sales increased by 5.6% to $2,615,600, while segment income decreased by 21.2% to $571,475[47] - North America Salty Snacks net sales rose by 10.0% to $321,020, with segment income up 6.9% to $57,747[47] - International segment net sales grew by 12.1% to $244,798, but segment income turned to a loss of $13,607 compared to a profit of $14,207 last year[47] Cost and Expenses - Unallocated corporate expense increased by 38.9% to $193.1 million, primarily due to higher incentive compensation costs[29] - The company incurred business realignment costs of $2,211,000 in Q3 2025, compared to $27,635,000 in Q3 2024[44] - Unallocated corporate expenses rose by 38.9% to $193,128, impacting overall profitability[47] Tax and Profitability Metrics - The effective tax rate for Q3 2025 was approximately 25.7%, an increase of 1,170 basis points compared to Q3 2024[18] - Reported gross profit for Q3 2025 was $1,037,334,000, compared to $1,232,719,000 in Q3 2024, reflecting a decline of 15.8%[33] - Reported gross margin for Q3 2025 was 32.6%, down from 41.3% in Q3 2024[36] - Non-GAAP gross margin for Q3 2025 was 31.8%, compared to 40.3% in Q3 2024[36] - Non-GAAP net income for Q3 2025 was $263,699,000, down 44.4% from $474,238,000 in Q3 2024[33] Outlook and Strategic Initiatives - The company raised its full-year net sales growth outlook to approximately 3%[6] - The company is focused on enhancing long-term profitability through initiatives like the Advancing Agility & Automation Initiative[39] Balance Sheet Highlights - Cash and cash equivalents increased to $1,163,017 from $730,746, reflecting a significant liquidity improvement[49] - Total assets rose to $13,579,426 from $12,946,861, indicating growth in the company's asset base[49] - Long-term debt increased to $4,677,086 from $3,190,210, suggesting a rise in leverage[49] - Total stockholders' equity decreased to $4,564,446 from $4,714,654, reflecting a decline in equity value[49]